The U.S. Securities and Exchange Commission (SEC or Commission) issued a cease and desist order on September 22, 2014 (Order) against private equity fund adviser Lincolnshire Management, Inc. (Lincolnshire). The Order alleged that Lincolnshire violated Section 206(2) of the Investment Advisers Act of 1940 (Advisers Act) by breaching the fiduciary duty that it owed to two separate private equity funds when Lincolnshire allegedly allocated shared expenses between a portfolio company held by one of those funds and a second portfolio company held by the other fund, in a manner that improperly benefited one fund over the other. The Order further alleged that Lincolnshire failed to adopt and implement written policies regarding the allocation of expenses between the two funds in violation of Rule 206(4)-7 under the Advisers Act. While neither admitting nor denying the allegations, Lincolnshire agreed to pay approximately $2.3 million to settle the SEC’s charges, including a $450,000 civil penalty.